Meal kit company Gousto, founded by Cambridge Judge Business School alumnus, reaches ‘unicorn’ $1bn valuation and says the boom in online food will continue after the pandemic.
Founded by Timo Boldt, an alumus of the Executive MBA programme at Cambridge Judge Business School (EMBA 2014), meal kit company Gousto recently achieved “unicorn” status – a valuation of more than $1bn – after new investment and rocketing sales during the UK’s coronavirus lockdown.
Timo is convinced that the boom in his “recipe-in-a-box” sector is not a temporary blip, but is here to stay.
“We believe the shift to online in grocery is permanent and is simply an acceleration of a pre-existing trend,” he says. “Figures from the Office for National Statistics show online food sales accelerating from +85 per cent year-on-year in April 2020 to +99 per cent in October 2020 despite less stringent lockdown measures” following the summer easing of the UK’s initial lockdown.
The latest investment in Gousto comes from existing partners Perwyn and BGF, following a scramble for grocery delivery service subscriptions during the COVID-19 lockdown and a high-profile endorsement by celebrity fitness coach Joe Wicks, known for his workout videos.
The company says the new funds will enable greater investment in technology and fulfilment capacity to better serve its customers. With a 300-person office in west London and two fulfilment centres in Lincolnshire, the company now employs more than 1,000 people. Gousto is opening two further fulfilment centres in Thurrock and Warrington over the next 18 months that it expects to create thousands of more jobs.
“Unicorn status is a milestone for the team and something to be proud of, but our focus is firmly on serving customers and building additional capacity,” says Timo, 35, a native of Germany who founded Gousto in 2012 with a mission to become the UK’s “most-loved way to eat dinner.”
After experiencing a surge in registrations during the UK’s first lockdown in March, which saw it briefly halt new registrations to cope with demand, Gousto has gone on to double its monthly meal deliveries, from 2.5m to 5m, over the course of 2020.
Timo is confident the company is well-placed to maintain this momentum, even after the hospitality industry and restaurant dining further opens up.
“There are 1bn meals eaten each week in the UK and Gousto is just over 1m of them,” he says. “We are just scratching the surface.”
Timo joined the Executive MBA at Cambridge Judge in 2014, graduating in 2016, and is a member of Pembroke College. The programme, which sees executive-level professionals from different industry sectors all over the world come together to gain an MBA on a part-time basis, was an opportunity for Timo to expand his network and learn from the experiences of others.
“For me it was all about people and I was fortunate to meet some amazing individuals,” says Timo, who worked as a finance professional in London before pivoting to entrepreneurship. “Two people I met subsequently joined Gousto, which was a great outcome.”
Along with rival meal kit delivery companies Hello Fresh and Simply Cook, Gousto is a key UK player in a market that a research report estimates will reach nearly $20 billion globally by 2027 following a compound annual growth rate of 12.8 per cent.
In such a highly competitive marketplace, Timo says advanced technology is vital to determine and meet demand, minimise food waste and ensure timely delivery – but tech alone is insufficient for success.
“Customer obsession is the most important ingredient,” he says. “Place your focus on customers, not competitors, and obsess about improving their experience. Our focus is on offering our customers the best choice, most convenience and an amazing experience powered by technology and data.”